Catfish Petitioner Says Commerce Still Using Wrong Surrogate Selection Standard on Remand

A petitioner submitted its final brief March 25 opposing the Commerce Department’s continued use of India as a surrogate for Vietnam in its review of an antidumping duty order on frozen fish fillets. It argued that Commerce was mixing up the definitions of “same” and “comparable” in its surrogate selection process (Catfish Farmers of America v. U.S., CIT # 21-00380).

Petitioner and plaintiff Catfish Farmers of America argued in its brief that Commerce hadn’t done what the Court of International Trade had told it to do on remand (see 2307170051). When he sent back the review, Judge M. Miller Baker said the department had “misapplied the statutory standard” for picking surrogate countries by only considering nations at the “same” level of development to Vietnam. The statute requires Commerce to look at countries at “comparable” levels of development, not just the “same” level, he said.

On remand, Commerce continued to choose India over the petitioners’ preference, Indonesia, though it said it had reconsidered the merits of Indonesian data (see 2311070027).

In its defense, the government said Feb. 16 that Commerce uses the term “‘same’ as ‘one of convenience.’” By its actual process, it first selects six potential surrogates, it said. It said the department prefers to pick countries at the “same” level of economic development as the nonmarket economy, but Commerce still leaves open the possibility of selecting countries that are comparable at some level “to the extent that data considerations outweigh level-of-economic-development differences or significant producer considerations.”

“Commerce attempts to justify its ‘same’-level methodology by explaining that ‘same’-level countries comprise the subset of economically ‘comparable’ countries that Commerce deems most economically comparable with the relevant NME,” Catfish Farmers said. “But even taking this explanation at face value, the statute specifies that the appropriate standard is ‘comparable,’ not ‘same.’”

Catfish Farmers argued that the department dedicated “substantial time to defending its use of a ‘sequential’ analysis,” but that this missed the point.

“The Court did not find fault with this [sequential] aspect of Commerce's primary surrogate country selection methodology,” it said. “Rather, the Court found that the agency could not lawfully consider countries with only the ‘same’ level of economic development as the subject country to be potential surrogates.”

By failing to apply the appropriate standard of “comparable economies,” Commerce had “unlawfully narrowed” the pool of surrogate countries from which it could draw, the petitioner said.

The remand instructions also required Commerce to lay out more specifically how it identifies “same”-level countries, but the department didn’t do this, either, Catfish Farmers said. It said a “generalized explanation” was provided in the results, but Commerce neither named any other factors it considered besides gross national income, nor explained how those factors were assessed.

The petitioner also took issue with Commerce’s analysis of both Indonesian and Indian data for valuing costs of production. It said the record doesn't support that Indian data reflects broad market averages, pointing to its data collection methods.

It said the Indonesian data is not inaccurate, as Commerce claims. The department found that Indonesian data for whole live fish and fingerlings were not input-specific, “because Indian governmental fisheries statistics cover certain species in addition to pangasius hypophthalmus,” a species of shark catfish. Commerce did concede “that there is record evidence indicating that pangasius hypophthalmus is the 'dominant' species reflected in the statistics.”

But “Commerce finds that evidence either speculative or unconvincing,” it said. “But it fails to acknowledge the lack of any evidence indicating that pangasius hypophthalmus is not predominately represented in the statistics. Indeed, the record evidence agrees that it is.”